Item 5: Fees & Compensation
6 Meridian offers services for a fee based upon assets under management. Additionally, certain of the
Firm’s Access Persons, in their individual capacities, may offer securities brokerage services and/or
insurance products under a separate commission-based arrangement. 6 Meridian’s wealth
management fee will vary depending upon the assets under management and services provided.
Annual fees for clients will be subject to the following tiered fee schedule:
Assets Under Management Annual Percentage of Assets Charge
$0 to $2,500,000 1.00%
$2,500,000 to $7,500,000 0.75%
Over $7,500,000 0.50%
The annual fee is prorated and charged monthly, in arrears, based upon the average daily account
balance for the month. Since the asset-based fee is determined by average daily account balance, if
assets are deposited into or withdrawn from an account after the inception of a month, the base fee
payable with respect to such assets is adjusted accordingly. In certain cases, 6 Meridian will agree to
charge a flat consulting fee of $10,000 per month. If an advisory agreement is terminated, the fee for
the final billing period is prorated through the effective date of the termination and the outstanding
or unearned portion of the fee is charged or refunded to the client, as appropriate.
Additionally, for asset management services the Firm provides with respect to certain client holdings
(e.g., held-away assets, accommodation accounts, alternative investments, etc.), 6 Meridian may
charge no fee or may negotiate a fee rate that differs from the range set forth above.
Fee Discretion
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6 Meridian may, in its sole discretion, negotiate to charge a lesser fee based upon certain criteria,
such as anticipated future earning capacity, anticipated future additional assets, dollar amount of
assets to be managed, related accounts, account composition, client holdings, pre-existing/legacy
client relationship, account retention and pro bono activities.
Additional Fees and Expenses
In addition to the advisory fees paid to 6 Meridian, clients may also incur certain charges imposed by
other third parties, such as broker-dealers, custodians, trust companies, banks and other financial
institutions (collectively “Financial Institutions”). These additional charges may include securities
brokerage commissions, transaction fees, custodial fees, fees charged by the Independent Managers
(charged to all clients other than certain legacy clients whose agreements will reflect the inclusion of
these fees), margin costs, charges imposed directly by a mutual fund or ETF in a client’s account, as
disclosed in the fund’s prospectus (e.g., fund management fees and other fund expenses), fees and
commission for assets not held with our primary custodian (such as 401(k) or 529 plan assets), fees
imposed by variable annuity providers, fees attributable to alternative assets (including transaction
fees), deferred sales charges, odd-lot differentials, transfer taxes, wire transfer and electronic fund
fees, and other fees and taxes on brokerage accounts and securities transactions. In connection to its
sub-advisory serves performed for the ETC-6 Meridian ETFs and Blue Arc’s private fund
offerings, 6 Meridian receives a percentage of the overall advisory or management fee. For
additional information, investors are encouraged to read the applicable prospectus or private
placement memorandum (“PPM”) available from our Firm’s website or from Blue Arc in the case
of the PPM. The Firm’s “Brokerage Practices” are described at length in Item 12, below.
Authorized Direct Fee Debit
Clients generally provide 6 Meridian and/or certain Independent Managers with the authority to
directly debit their accounts for payment of the investment advisory fees, which is done monthly in
arrears. The Financial Institutions that act as the qualified independent custodian for client accounts,
from which the Firm retains the authority to directly deduct fees, have agreed to send statements to
clients not less than quarterly detailing all account transactions, including any amounts paid to 6
Meridian. Alternatively, clients may elect to have 6 Meridian send a separate invoice for direct
payment.
Use of Margin
6 Meridian may be authorized to use margin in the management of the client’s investment portfolio.
In these cases the fee payable will be assessed net of margin such that the market value of the client’s
account and corresponding fee payable by the client to 6 Meridian will not be increased.
Account Additions and Withdrawals
Clients may make additions to and withdrawals from their account at any time, subject to 6
Meridian’s right to terminate an account. Additions may be in cash or securities provided that the
Firm reserves the right to liquidate any transferred securities or declines to accept particular
securities into a client’s account. Clients may withdraw account assets on notice to 6 Meridian,
subject to the usual and customary securities settlement procedures. However, the Firm generally
designs its portfolios as long-term investments and the withdrawal of assets may impair the
achievement of a client’s investment objectives. 6 Meridian may consult with its clients about the
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options and implications of transferring securities. Clients are advised that when transferred
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